Sintex Industries is a good bet

Discussion in 'Ask A Query About Your Stock Picks And Portfolio' started by Ravikumar, Nov 27, 2015.

  1. Ravikumar

    Ravikumar Active Member

    Joined:
    Nov 3, 2015
    Messages:
    195
    Likes Received:
    82
    Research report from Motilal Oswal:

    Buy Sintex ; CMP Rs 101; Target price of Rs 145 Sintex’s business model is strongly connected with macro-outlook and boost in government spending. The company will be a major beneficiary from government’s strong focus on wide range of infrastructure and social improvement plans viz. education, healthcare, sanitation, housing etc.We believe the best is yet to come for the company, but delay in broad based recovery cycle in B2G projects remains elusive. Spinning project, despite being economically incentivized, might post disappointment in the scenario of weakening cotton price. With FCCB conversion getting over, dilution risk is behind. With capex cycle getting over, we expect gradual moderation in gearing FY17 onwards. We keep our EBITDA est. intact, raise FY16 EPS by 22% (FY17 intact) due to deferment of interest and depreciation from spinning from to FY17 (will be capitalized in FY16 as guided by management). The stock trades attractively at 6x FY17E EPS and 4.8x FY17E EV/EBITDA (LT average of 6x) and 0.8x FY17E P/B (RoE 13%). We value SINT at 6x FY17E EV/EBITDA, which translates into a fair value of INR145/share. Maintain Buy with target price of Rs 145

    I have been tracking this stock from CMP of 40.
     
    Srouta Mukherjee likes this.
  2. ANITHA

    ANITHA New Member

    Joined:
    Oct 27, 2015
    Messages:
    26
    Likes Received:
    18
    I feel Sintex is due for P.E relating. Presently Quoting @ single digit P.E. which is not at all justifiable. Any such rerating gives multifold gains.
     
    Srouta Mukherjee likes this.
  3. Srouta Mukherjee

    Srouta Mukherjee Well-Known Member

    Joined:
    Mar 28, 2015
    Messages:
    1,898
    Likes Received:
    769
    Do you have report? Can you upload it pl.
     
  4. ANITHA

    ANITHA New Member

    Joined:
    Oct 27, 2015
    Messages:
    26
    Likes Received:
    18
    No. It's just my assumption.
     
  5. kharb

    kharb Well-Known Member

    Joined:
    Aug 15, 2015
    Messages:
    1,021
    Likes Received:
    734
    Spinning textile project may drag it to stagnate ,otherwise a good company.
     
Loading...